We hear the same story from brands all the time—Amazon is your fastest growing channel. But when you dig a little deeper, are your profits growing as fast as your revenue?
At Pattern, we know maximum profitability comes from brand control on the marketplace giant, and we work with top global brands to control distribution and your channel, by removing unauthorized sellers, to accelerate growth on Amazon.
In retail, wide distribution is king. But online, wide distribution causes problems.
Before online shopping, wide distribution allowed brands to get in more stores, reach more customers across more doors, and make more sales. This model worked because it was more time-consuming and inconvenient for customers to drive back and forth between a myriad of stores to find the lowest price and then circle back to make a purchase. Depending on the price point, customers may have bought the first or second option they found.
In the ecommerce realm, however, customers can compare multiple online sellers within seconds, whether they are shopping from home or price checking in-store. And since all of your sellers are carrying the same product, with the same quality, the only differentiator is price. If one seller lowers their price to win sales, they inadvertently create channel conflict across both your online and in-store prices. Then, in order to compete, other sellers must lower their price as well, starting the domino effect of price erosion and your brand’s profitability death spiral.
Narrow distribution online allows you to better control who has access to your products, where it’s sold, and how much competition exists.
If wide distribution opens the floodgates, narrow distribution is the lock that holds everything closed. Without carefully selecting a narrow list of authorized distributors, your product can make its way into the hands of unauthorized sellers across marketplaces and retail sites. Then, unauthorized sellers will cut price to achieve one goal—offload product online as fast as possible to make a quick profit.
Whether the unauthorized sellers bought your product in bulk when your price had eroded to its lowest level on Amazon, or were an honest wholesale buyer who needs to liquidate excess inventory from their big box or boutique store, unauthorized sellers damage your brand. By narrowing your distribution to an authorized list of select sellers and stores, you help eliminate the opportunity for your product to be passed around. Narrow distribution cuts off the bandits' supplies.
As a bonus, when you maintain a list of authorized and unauthorized sellers, you send a message to your distributors that those who don’t comply will lose the opportunity to sell.
At Pattern, we work as your exclusive Amazon distributor, instantly helping narrow your distribution. Additionally, we provide best-in-class technology to identify and track unauthorized sellers. We then work with top tier eControl partners, like Vorys, to analyze and interpret the seller data, and allow Vorys to action all necessary legal steps. We work to give our partners all the resources they need to enforce their MAP policy and support their control strategy.
Having unauthorized sellers on Amazon blocks your profitability. Unauthorized sellers get a hold of your product, drop the price to win the Buy Box, and steal your sales. But that’s just the start.
When unauthorized sellers lower the price, they create price erosion. With one unauthorized seller taking all the sales at a lower price, your authorized sellers are forced to lower their price to compete, but then the unauthorized seller just lowers the price again, creating a race to the bottom and eroding your profit margin along the way.
With a rampant price erosion problem, consumers will acclimate to the lower price. When new products are released, customers may choose to wait for lower prices on Amazon. But that’s not where it ends—the nature of Amazon’s marketplace means unauthorized sellers have the same level of access as you to update your listing images, copy, and branding. So, in an effort to make a quick sale, unauthorized sellers can misrepresent your brand and create a poor user experience, hurting your hard-earned reputation. Over time, this devalues your brand and hurts long-term profitability.
While unauthorized sellers can feel like the biggest threat, removing them comes only after narrowing your distribution. If you don’t address the root of the problem it’ll just keep growing. But, with precise distribution in place you can start successfully removing the remaining unauthorized sellers to create a clean selling channel.
Pricing policies, like MAP compliance, are key for removing unauthorized sellers. MAP policies give clear guidelines to sellers and make addressing violators easier. Afterall, how well can you reprimand someone for breaking a non-existent rule?
Pattern helps brands remove unauthorized sellers by marrying data from our proprietary technology with a Vorys partnership. Using actionable data-driven insights, Vorys can assist in creating and enforcing a MAP policy, identifying unauthorized sellers, and enacting takedowns.
Maximizing profitability on Amazon comes down to controlling your distribution and sales channels. While the steps sound simple, this process can become complicated and cumbersome for brands to handle alone—that’s why Pattern provides the technology, expertise, legal partners, and experience to help you achieve brand control.
Ready to maximize profitability on Amazon? Set up a meeting today.
Entering the ecommerce landscape is a huge undertaking for any brand—it usually requires a large investment in resources and expertise to really be successful. Any brand can quickly get in over their heads trying to navigate the nuances of SEO, fulfillment and logistics, distribution control, listing optimization, and meeting the numerous other requirements and administrative tasks to show up well on marketplaces.
Unfortunately, because it’s so easy for third party, gray market, and unauthorized sellers to obtain and sell products online, many brands find themselves pressured to execute an ecommerce plan without the right resources to succeed on marketplaces and their other channels.
So, for brands looking to enter the ecommerce space or improve their current and future performance, it makes sense to partner with an ecommerce consultant.
Pattern’s global presence and proven success with hundreds of brands has allowed us to develop highly effective ecommerce consulting services. We can guide your brand to navigate issues both large and small in marketplaces worldwide. To maximize your ecommerce efforts, you’ll need to understand what an ecommerce consultant does and how to select one who drives the right value for your brand and products.
An ecommerce consultant is a specialist in the ecommerce space who can give you personalized guidance on how to market your products and grow their presence on digital marketplaces.
An ecommerce consultant should be able to analyze your brand, audience, category, opportunity, and current roadblocks and help you understand how to utilize your resources (or what resources are missing) to be most effective in capturing your opportunities in the ecommerce space.
Not sure how to evaluate a consultant? Here are 4 key attributes to look for as you make your choice.
At Pattern, we prioritize brand obsession for a reason—we know that a brand-centered mindset makes a crucial difference in the outcomes and results our partners achieve. So in our experience, when you begin your search for an ecommerce consultant, it’s important to look for a partner who is specialized in ecommerce, invested in the product, and passionate about helping brands build and improve their strategies. Typically, this means finding someone that consults exclusively for ecommerce marketplaces, rather than choosing a consultant who offers many different services.
It’s also important to avoid choosing a consulting partner who can’t deliver the right experience for your brand. The best indication of whether your potential consultant can do that is to review their history, data, and results with other brands. Ask if they’ve helped others in your selling category, if they’ve solved specific issues your brand is facing, and why they feel you are a good fit. The key is to leave the conversation feeling confident that you understand your consultants’ capabilities and whether or not they match up with your needs.
It’s best to pick a consultant who knows how to guide a brand onto and through multiple marketplaces worldwide. You’ll want to take a look at your long-term strategy and think about the regions and platforms you’re currently on and where you might want to take your brand in the future. If your consultant is truly great at what they do, they’ll be able to help you perform well enough with your current product roadmap that it’ll be a no-brainer to expand your presence at the right time.
The most effective partnership with an ecommerce consultant will be able to give you both recommendations and point you to solutions for making those changes in your planning, processes, and execution. Your time and money is valuable, so you want to make sure that you’re spending it as efficiently as possible as you follow your consultant’s advice. So, before you commit to an ecommerce consultant, ask about the resources and concrete solutions they typically recommend to the brands they work with.
Finding an ecommerce consultant that checks the boxes can be a difficult task. At Pattern, our entire focus and drive centers around giving brands the tools and resources they need to succeed on domestic and international ecommerce marketplaces.
With over 100 global ecommerce consultants across 10 global offices, we have the right tools to partner with brands across the world to achieve better ecommerce success. We give specialized advice, then make sure our partners have all the adequate SEO, social media, CRM, Amazon multi-channel fulfillment services, and ecommerce outsourcing services they need.
Interested in ecommerce consulting services? Set up a call here to learn what Pattern can do for your brand on global marketplaces.
If you’re interested in expanding your brand internationally, you’re probably familiar with Tmall. Tmall is Asia-Pacific’s (APAC) largest marketplace, and indisputably the biggest ecommerce powerhouse in the world. It represents a huge opportunity for many brands, but entering the space is also a big challenge to take on.
At Pattern, we recommend brands looking to enter international markets should first focus on dialing in their domestic presence. Once you’re satisfied that your brand is well-represented and optimized locally, you’re ready to think about tackling new regions, like APAC, and launching on marketplaces like Tmall. Our top advice for entering Tmall is to understand and strategize around its three most important metrics: service, delivery, and content.
Service, delivery, and content ratings are the three elements that make up Tmall’s Detailed Seller Rating (DSR) score. Each component is scored on a scale of 1-5 that is displayed publicly on your brand’s Tmall flagship store page. This is meant to help consumers decide whether or not to purchase your products.
DSR scores are important because they’re highly influential in driving conversions—customers see DSRs as a way to quickly understand if a brand is trustworthy and worth buying from. They also matter quite a bit to Tmall itself—they monitor these scores and will take action to close flagship stores with low scores.
Let’s go over each element of the DSR score and some steps you’ll need to take to achieve high ratings.
Service is a huge ecommerce component in APAC marketplaces. In most other regions, product listings are static, and consumers use content and reviews to make a decision about what to purchase. On Tmall, consumers want to interact with your brand and test its validity before buying—each transaction takes at least one human interaction to convert.
So, to get a great service rating, you’ll need to have a large, established customer service team dedicated to Tmall sales that can offer real, human touchpoints and very fast response times. To get an idea of the speed your agents should be capable of producing, in our Tmall benchmarking exercise, 92.5% of brands’ customer service agents replied to queries via live chat within 30 seconds, 5% replied within one minute and the remaining 2.5% of brands took longer than a minute. So, look for a Trade Partner (TP) that has enough resources to compete with those numbers, support your sales, and maintain a good DSR score.
Another thing you’ll really want to focus on is a high-quality delivery experience for consumers. As in other regions around the world, Tmall consumers have high expectations for their delivery experience. In our Chinese consumer polling report that targeted consumers buying from Tmall Global, we found that 6% expected same-day delivery, 15% expected next-day delivery, and 46% expected 2-5 day delivery.They want to receive their products fast and they want the products to be undamaged and pristine upon arrival.
So, to achieve a high score for your delivery capabilities, we highly recommend partnering with a TP or ecommerce accelerator like Pattern (which serves as a TP) who has the ability to facilitate your distribution. Make sure your TP has the right infrastructure in place to support high-quality logistics experiences for all of your consumers—they should have an established, well-oiled delivery process in place and the capability to fluidly add you to their current fulfillment system.
As in every digital marketplace, content is a huge component of the decision-making process for consumers on Tmall—they can’t touch your product with their hands or see it in person before buying, so it’s important they’re empowered to make a good decision on whether or not to purchase based on the videos, images, and copy.
The goal is to make all of the content and relevant information on your flagship site easily-accessible—consumers should be able to visit your page and make a decision about whether or not to buy without navigating to a new site/page and taking their conversions with them. Images with text and extensive product details are a great way to do this, as well as making sure your service team can speak to all aspects of your product with any consumers (via text or chat).
As the world’s foremost brand partner for ecommerce acceleration, Pattern truly understands the significance of international expansion. With regional offices around the world, Pattern knows how to successfully launch and grow brands on Tmall and other marketplaces, with the data, insights, and marketplace intelligence to build the metrics that matter.
It’s important to have a fantastic brand presence, a knowledgeable guide, and a clear go-forward strategy for your best chance at success. With our in-country resources, expert teams, and extensive experience in growing brands around the globe, Pattern can help you get there.
Set up a call to get your international expansion strategy in motion.